This deal isn't for everyone - just those that have built up 50% equity in their property through property price rises, mortgage capital repayments or some combination of the two. Of course, first time buyers can apply - but those with a 50% deposit will be few and far between.
The 1.25% rate is the lowest that's been offered for such a product in about 10 years.
There's a £999 fee which would be a big concern if this were a 2-year product. I'm on a lifetime rate with First Direct myself and like the fact that payment of one fee secures you a good deal for the life of your mortgage. Too many people pay fees every 2 or 5 years without putting much thought into it.
As anyone who's investigated mortgage deals with the scrutiny they deserve will realise, when a mortgage balance gets lower, it becomes difficult to get good deals because fees represent too high a percentage of the outstanding value of the mortgage to make switching worthwhile. This leaves a lot of people stuck on standard variable rates or some sort of poor retention deal.
With these lifetime rates, at least you know you'll always be on a pretty competitive deal. Of course, Coventry base the rate on their variable rate as opposed to the Bank of England base rate - but they've never raised this above the BOE rate in the past and to do so in the future would be a very poor commercial decision from them. In the unlikely event that they do this, the product has no early repayment charges so you could just switch at any time.
All comments (18)
marathonic
31 Jan 17#1
The deal includes their Remortgage Transfer Service (which includes standard legal fees) and a free valuation.
sparx1981
31 Jan 17#2
Just to confirm, this is a variable rate mortgage and is just at this rate for now. If rates increase, this is likely to go up too. Is that correct?
marathonic to sparx1981
31 Jan 17#3
Correct. It's tied to a Coventry variable rate - which has basically mirrored the Bank of England base rate for years.
In the UK, there is no such thing as a fixed rate that lasts for the life of a typical mortgage - 10 years is usually the max fixed term - and you'll pay for it.
It's an unknown whether this or any specific fixed rate will work out best in the long-term. The general opinion of a lot of people is that a lower rate with over-payments bringing your monthly outlay up to that that you'd face with the higher fixed rate will 'probably' work out better in the long run. Basically, a reduction in outstanding mortgage balance is better protection against rising rates than a short-to-medium term fixed rate with it's associated premium.
paulmckinnon359
31 Jan 17#4
yep good deal but it is a variable rate deal not fixed so can go up as well as down
rooney10
31 Jan 171#5
Our mortgage is fixed at 0.39% above BBR for the lifetime of our mortgage (which had 23 years left at the time we got it , fees were around the £1k mark too )
Not seen a better deal than this since we got it back in 2008
ashehzad to rooney10
4 Feb 17#10
I'm looking for mortgage. Does this still available?
spicy_gal
31 Jan 172#6
i applied for their fixed term product last week, directly with cov. building society and their process took over 1.5 hrs, the questions they ask border on ridiculous. We passed the affordability criteria but they were still asking naff questions such as why did why want to reduce our term?
errm? because we want to be mortgage free earlier and can clearly afford it! erghhh
m1chaels
31 Jan 17#7
Flexible? IO possible?
whatyadoinsucka
1 Feb 171#8
its a variable tracker, the same as any lifetime (base rate) tracker, maybe worth adding the word "Variable" in your header. although it doesnt directly tracker the base rate, it will no doubt move up inline with boe base rate.
ie base rate goes up 0.5% then this will too, although coventry bs can chose what they please i'd assume in the small print..
Great rate though
marathonic
3 Feb 17#9
** updated as rate reduced to 1.25% **
nikdoshi
4 Feb 17#11
yes
krizw
11 Feb 17#12
Looks great, bar the fact that there is no link to Bank of England Bank Rate. Tempted though.
kanesurveys
14 Feb 17#13
". Of course, Coventry base the rate on their variable rate as opposed to the Bank of England base rate - but they've never raised this above the BOE rate " - Is this a true statement? Meaning at least historically this hasn't happened, though abs no guarantee about the future.
muffboy
18 Feb 171#14
"Coventry base the rate on their variable rate as opposed to the Bank of England base rate - but they've never raised this above the BOE rate in the past and to do so in the future would be a very poor commercial decision from them"
What on Earth are you talking about? BOE base rate is currently 0.25%, this is @ 1.25%, hence you are making very misleading statements.
No lender in history has ever offered a mortgage rate that was lower than BOE base rate, THAT would be commercial suicide!
I think you meant to state that CBS never made an incremental increase at any time more than the BOE increase, however this is nothing special and is par for the course most of the time with the vast majority of lenders.
fr3dy77_sp33d
18 Feb 17#15
what a weird product. it's SVR but with a good rate. problem is there is no certainty. if only they put it as "lifetime tracker" then I'll jump in. this way... I dare not to put my fate into their hand to call out the svr rate in the future
fr3dy77_sp33d
18 Feb 17#16
I vote hot simply because it does offer good rate in comparison to other banks
Dan_999
18 Feb 17#17
Flex for term is a bit misleading, makes you think it's for a fixed term, I.e the usual 2,5,10yr fixes
marathonic
18 Feb 17#18
Apologies, I'll need to clarify.
The Flexx for Term product is a long-standing product of Coventry. In the past, the product information referred to it being a tracker, tracking a certain percentage above an internal Coventry Base rate. It's this that has always mirrored the BOE rate. They have recently updated the marketing material to remove any reference to 'tracker' as it was confusing some customers.
A little under half of their mortgage book is in products like this so it would be financial suicide for them to pump up the rate before the BOE rate increases as all the mortgages are exit-fee free.
This is 100% incorrect, hence you are making very misleading statements.
At one time, C&G offered a tracker at 1.01% below base.
Woolwich, at one point, were offering trackers at 0.68% below base.
There were others but the above are the two that spring to mind.
Do you not remember the newspapers having stories related to mortgage borrows on rates where, in theory, the bank should have been paying them interest? The reality was that the banks stopped at 0% and borrowers just had an interest-free mortgage.
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Opening post
This deal isn't for everyone - just those that have built up 50% equity in their property through property price rises, mortgage capital repayments or some combination of the two. Of course, first time buyers can apply - but those with a 50% deposit will be few and far between.
The 1.25% rate is the lowest that's been offered for such a product in about 10 years.
There's a £999 fee which would be a big concern if this were a 2-year product. I'm on a lifetime rate with First Direct myself and like the fact that payment of one fee secures you a good deal for the life of your mortgage. Too many people pay fees every 2 or 5 years without putting much thought into it.
As anyone who's investigated mortgage deals with the scrutiny they deserve will realise, when a mortgage balance gets lower, it becomes difficult to get good deals because fees represent too high a percentage of the outstanding value of the mortgage to make switching worthwhile. This leaves a lot of people stuck on standard variable rates or some sort of poor retention deal.
With these lifetime rates, at least you know you'll always be on a pretty competitive deal. Of course, Coventry base the rate on their variable rate as opposed to the Bank of England base rate - but they've never raised this above the BOE rate in the past and to do so in the future would be a very poor commercial decision from them. In the unlikely event that they do this, the product has no early repayment charges so you could just switch at any time.
All comments (18)
In the UK, there is no such thing as a fixed rate that lasts for the life of a typical mortgage - 10 years is usually the max fixed term - and you'll pay for it.
It's an unknown whether this or any specific fixed rate will work out best in the long-term. The general opinion of a lot of people is that a lower rate with over-payments bringing your monthly outlay up to that that you'd face with the higher fixed rate will 'probably' work out better in the long run. Basically, a reduction in outstanding mortgage balance is better protection against rising rates than a short-to-medium term fixed rate with it's associated premium.
Not seen a better deal than this since we got it back in 2008
errm? because we want to be mortgage free earlier and can clearly afford it! erghhh
ie base rate goes up 0.5% then this will too, although coventry bs can chose what they please i'd assume in the small print..
Great rate though
What on Earth are you talking about? BOE base rate is currently 0.25%, this is @ 1.25%, hence you are making very misleading statements.
No lender in history has ever offered a mortgage rate that was lower than BOE base rate, THAT would be commercial suicide!
I think you meant to state that CBS never made an incremental increase at any time more than the BOE increase, however this is nothing special and is par for the course most of the time with the vast majority of lenders.
The Flexx for Term product is a long-standing product of Coventry. In the past, the product information referred to it being a tracker, tracking a certain percentage above an internal Coventry Base rate. It's this that has always mirrored the BOE rate. They have recently updated the marketing material to remove any reference to 'tracker' as it was confusing some customers.
A little under half of their mortgage book is in products like this so it would be financial suicide for them to pump up the rate before the BOE rate increases as all the mortgages are exit-fee free.
This is 100% incorrect, hence you are making very misleading statements.
At one time, C&G offered a tracker at 1.01% below base.
Woolwich, at one point, were offering trackers at 0.68% below base.
There were others but the above are the two that spring to mind.
Do you not remember the newspapers having stories related to mortgage borrows on rates where, in theory, the bank should have been paying them interest? The reality was that the banks stopped at 0% and borrowers just had an interest-free mortgage.